Buddhist Economics Part 3: Egocentrism, Compassion, and the Well-Being Economy

Our fundamental beliefs about human nature are rooted in experience. We look at what humans have done in the past, and we use this to understand who we are now. However, because these beliefs are so connected to our lived experience, they are subject to change as our reality transforms. Yet as high-tech, automated technologies continue to carry is to a whole new world, our perceptions about life remain the same, which slows our ability to progress.

As a whole, we still see life as a perilous fight for existence defined by the competition for scarce resources. But we are entering a period where abundance, not scarcity, will be the norm, meaning we need to exchange our competitive perspective for something else.

In short, this “something else” will be an acceptance that cooperation, based on principles of compassion, and not competition, is the secret to a good life. Buddhist Economics provides a lens for helping us see this, allowing us to understand the world and how we can change it.

About this Series

To demonstrate how Buddhist economics is a useful tool for thinking about sustainable societies, we’re presenting different pieces of the theory and contrasting it with our traditional conceptions of the economy.

The series includes discussion about the dominant economic theories of the day, and it touches on how an injection of Buddhist thought into these theories could help make them more applicable for the sustainable societies we’re trying to build.

Understanding Our Human Nature

Do we live in a world where everyone competes for the resources needed for individual survival? Or do we live in a world where cooperation is needed to ensure survival of the species?

The answer is yes. To both. Living things are defined by their environment. Their genetic makeup dictates how successful they will be in a given habitat, and over time, the Law of Natural Selection will shape the species so that its dominant genes give it the best chance of survival. This is why some species, such as lions, need competition. The lands supporting the life lions require to survive are truly scarce, forcing lions to to be territorial and competitive. Dolphins, however, do not face these same challenges, and confronted with an abundant food supply and expansive habitat, they have evolved to be a more cooperative species, as this increases their overall chances of survival. This can change as the environment changes. If food becomes scarce, we can expect any species to become competitive. Therefore, for a competitive relationship to occur, there must first be a sensation of scarcity.

So where do we, as humans, stand? Are we competitors, or are we cooperators? Our frequent wars, obsession with sports, and hero worship suggest we are in fact competitors, but does that tell the whole story? In sum, not really.

The Complexity of Humans

If humans are anything we are complex. Simplifying our nature is therefore unwise. We are part competitors, part cooperators, and part everything in between. But throughout history, our environment has dictated that competition is the most desired trait, and this means that as we move into an age where cooperation will be more effective, we will be left with systems and institutions molded from competition.

It’s important to be aware of this so that we can change existing systems and institutions to be more conducive to cooperation rather than competition.

Competition and the Economy

The way we perceive the economy is one of the best example of how our emphasis on competition has shaped our world.

Generally speaking, the function of an economy is to produce and distribute the goods and services needed by the people in a given territory. However, modern market economics have shifted the emphasis. They now see the function of the economy as a mechanism for maximizing the gains made by those participating in the market. Meaning, in addition to using the market to exchange needed and desired commodities and luxuries, we now use it to maximize the amount of things we can buy or sell.

This logic creates competition because it puts similar producers into a zero sum game. If Farmer A sells more tomatoes, then Farmer B will most likely sell less, except of course if there’s a spike in demand. If this does happen, though, Farmer A and Farmer B would not work together to meet this new demand, rather they would compete to be able to supply it by themselves.

In this scenario, one of two things are most likely to occur:

Farmer B can’t keep up with Farmer A and he eventually shrinks the size of his farm, which reduces his income. This may lead, at some point, to Farmer A absorbing Farmer B by acquisition. Or, Farmer B may just dissolve the business and look for work elsewhere.

Farmer B comes up with ways to stimulate demand for tomatoes, increasing the amount of supply needed and helping to create a market large enough to support two tomato farmers.

The preferred scenario is obviously the second. But it takes time to grow demand for new products, and it might not happen fast enough for Farmer A to stay afloat.

What’s the Big Deal?

Some may read this and wonder, “What does it matter? Maybe we only need one farmer, and having two is unnecessary. This scenario reduced waste and made us more efficient.”

This is true, and because of this, there is always going to be a need for competition. But it must be done in a healthy way. In an economy based on growth and its infinite perpetuation, it’s in each firm’s best interest to reduce their own competition, as this is the only way they can expand their share of the market. This contributes to the zero-sum game we discussed earlier, and it sets an aggressive tone for the economy.

However, the real conclusion to be drawn here is that our economy is based on the principle that fulfilling our own best interests is what’s best for the whole. This idea is grounded in Adam Smith’s The Wealth of Nations, where he proclaimed that specialization, freedom, and competition were the keys to building a strong society.

But as our economies complexify to the point where acquiring this level of specialization is so immensely difficult most can’t manage or afford to do it, the question must be asked if it’s time for a new set of ideas to govern the way we think about the economy.

The Buddhist Perspective

The defining principle of Buddhist teachings is that suffering defines existence, and nearly all of Buddhist thought and philosophy is dedicated to understanding suffering and its causes so that we can effectively remove it from our lives. And one of the key drivers of our suffering as defined by Buddhist teaching is our belief of and obsession with the Self, also know as egocentrism.

The Buddha taught to not believe in a Self. While we exist as individuals, we are really just small pieces broken off from a universal, unchanging whole that can neither be defined nor described, only experienced.

Believing too much in the Self creates attachment, largely because our notion of the Self is so closely linked to our physical bodies, which will some day perish. And this attachment—or our grasping to an impermanent entity as if it were permanent—creates suffering.

As a result, the Buddha advocated for practicing compassion. By turning your efforts outwards to those around you, the idea is that you can improve both your own lived experience and that of others. We all know how good it is to help someone out, and Buddhism simply teaches that we should be striving for that feeling at all times.

But Buddhism is not martyrdom. It’s not about giving up and sacrificing for the sake of others. Rather, it’s about recognizing the interconnectivity of everything and working together to preserve the fragile state of existence that is Life.

Moving Forward

Our current perception of the world is grounded in our history. And for much of human history, resources truly were scarce. The perpetuation of one group of people, whether a tribe, an ethnic group, or a nation, was closely connected to that group’s ability to secure a consistent supply of the resources needed for survival.

This ingrained competition into everything we do, and this has become one of the defining characteristics of the world today. But all of this is based on the notion that these resources are scarce, and that we must always work to have the maximum supply of them.

However, as we move forward, digital technologies and automated modes of production will continue to make the resources we need to survive more abundant, reducing our need to compete. As a result, it’s time for us as a species to recognize that a change of attitude is needed. It’s no longer in our best interest to specialize and compete. Instead, it’s in our best interest to cooperate. and to build systems that provide for the betterment of all.

The Shift to a Well-Being Economy

Thinking about a well-being economy is a useful exercise for imagining sustainable societies. A well-being economy is different than what we have today in that its primary focus is not the growth and expansion of goods produced and goods consumed, but rather of individual and societal well-being.

Shifting towards this type of economy requires us to ditch our notions of scarcity and competition in favor of abundance and cooperation, as the very idea assumes that what’s best for the whole is best for the individual, unlike our current system, where what’s best for the individuals is assumed to be best for all.

To return to our example of Farmer A and Farmer B, in a well-being economy where growth is not the main focus, we would remove the zero-sum component of the relationship. In this idealized world, inflation is controlled to keep prices from rising, and this removes the need for Farmer A to grow beyond a point that provides him with the income he needs to live a good life. This would leave space for Farmer B to operate, albeit his operation may be smaller. But it doesn’t matter, since both are able to engage in their desired productive activity without having to compete with the other.

Let’s Make This Happen

We must recognize the inability of an economy based on competition, maximization, and unlimited growth to build environmentally, socially, and economically sustainable societies. This will help us reduce our dependence on material consumption, which gives us a chance to focus on that which will have more of an impact on well-being.

We must begin to provide more support for people to develop the skills they themselves value, not those valued by the market, so that when they engage in productive activity they do so in a way that’s meaningful and enriching.

We must adopt policies, such as universal healthcare, expanded automation of manufacturing, and Universal Basic Income, that provide safety nets for those who wish to develop skills and pursue professions that fetch lower market prices but that produce higher well-being returns.

We are very far from making this happen, but everything must start somewhere.

The societies we have today are grounded in an understanding of human nature that is based in the past. However, we’re in the midst of a digital revolution, and just like all major shifts in human history before it, this revolution is set to redefine how we understand life and existence.

Our decreased dependence on competition is inevitable, as mechanized production reduces scarcity. But our shit to a well-being economy, and the formation of sustainable societies, are not.

As a result, it’s up to us to seize this moment and begin building a world defined by compassion, cooperation, and most importantly, peace with ourselves and Mother Nature,